Bail in Corruption Cases

In India, Corruption is broadly covered by Indian Penal Code, 1860 and the Prevention of Corruption Act, 1988. The Benami Transactions (Prohibition) Act, 1988 prohibits benami transactions. The Prevention of Money Laundering Act, 2002 penalises public servants for the offence of money laundering.  Its ambit got widened after the amendment to Prevention of Corruption Act in 2018. Apart from Public servants, Private entities (commercial organizations) and their directors, managers, secretaries or other officers brought within the radar of the new Bill.

Prosecution can be initiated by an investigating agency only after it has got the prior sanction of the central or state government. Government appointed prosecutors undertake the prosecution proceeding in the courts. All cases under the Prevention of Corruption Act, 1988 are tried by Special Judges who are appointed by the central or state government.

The Prevention of Corruption Act 1988 sets out that public servants found guilty of the prescribed offences will be subject to a prison term of between three and seven years and a fine to be set by the court. If any person convicted under the Prevention of Corruption Act subsequently commits an offence under the act, they will be subject to a prison term of between five and 10 years as well as a fine. Commission of relevant offences under the Penal Code is punishable with three to seven years’ imprisonment. Other penalties include confiscation or attachment of the accused property et al.

Bail: Bail connotes the process of procuring the release of an accused charged with certain offence by ensuring his future attendance in the court for trial and compelling him to remain within the jurisdiction of the court. In simple words, it is the process by which an accused person is released from custody.

The provisions for the Bail are provided under the Criminal Procedure Code, 1973. Section 436 of the Code provides for bail under the bailable offences. Section 437 provides bail for non-bailable offences, where the bail is granted on the discretion of the court. The court can even impose conditions to be followed if the bail is granted. This provision balances the principles of natural justice.

In the 268^th Law Commission Report, it was recommended that bail practices should address two key goals, first, to secure participation of accused in the trial and second, to provide safety and protection to the victim of the crime and society.

Case Laws regarding Bail given in Corruption Cases:

In the recent case, Gujarat HC while granting anticipatory bail to Social activist Teesta Setalvad and her husband in the relation to NGO Sabrang Trust receiving huge money, Justice JB Pardiwala advocated for ignoring the reputation of the applicants while deciding the application observing, “The reputation of the applicants in the society as well as being renowned journalists and social activists has nothing to do with the criminal charge of defalcation and misappropriation of the amount of grant. The grant of anticipatory bail being extraordinary in character, such a prayer should be favourably considered in exceptional cases where it appears that the applicants are falsely implicated or a frivolous case has been launched with a motive to harass them or tarnish their image or reputation and the cases of the like nature.” Court is also of the opinion that it cannot Allow Anticipatory Bail Just Because Arrest Would Tarnish Applicants’ Reputation.

In the case of Rakesh Kumar Paul v. State of Assam, Gauhati High Court order upholding the Special Judge’s order denying him the statutory bail for the offence punishable under Sections 7, 13(1)(b)(2) of the Prevention of Corruption Act 1988.  But, the three Judge Bench of the Supreme Court concluded that the accused is entitled to “default bail” under Section 167(2)(a)(2) of CrPC, since he had already spent more than 90 days behind bars even if the offence is punishable up to 10 years.

Under what circumstances Bail will not be given in Corruption cases?

Under Section 45 of Prevention of Money Laundering Act, (PMLA) 2002, provided that no person can be granted bail for any offence under the Act unless the public prosecutor, appointed by the government, gets a chance to oppose his bail. When the public prosecutor opposes the bail, the court has to be satisfied that the accused is not guilty of the crime and accused is not likely to commit any offence while out on bail. In a recent judgment titled as Nikesh Tarachand Shah v. Union of India, the Supreme Court has struck down the provision of Section 45 of the PMLA. This ruling struck down the clause, which made it virtually impossible to grant bail to the accused person.

In the case of Mallampati Gandhi S/O. Naga Raju vs The State of Telangana, the Court held that, “Bail law on economic and white collar offences is well delineated and no more res integra. Echoing the concern for economic offences, which are more dangerous and having far reaching impact on society than bodily offences, Honble Apex Court and several High Courts have held that in dealing with such bail applications, Courts are required to analyze and evaluate certain relevant factors cautiously.”

In the case of Murthy.V.K v. The State, The Hon’ble Court further held that an economic offence is committed with cool calculation and deliberate design with an eye on personal profit regardless of the consequence to the Community. A disregard for the interest of the Community can be manifested only at the cost of forfeiting the trust and faith of the Community in the system to administer justice in an even handed manner without fear of criticism from the quarters which view white collar crimes with a permissive eye unmindful of the damage done to the National Economy and National Interest. The Hon’ble Apex Court has further held that economic offences constitute a class apart and need to be visited with a different approach in the matter of bail.

In the recent times, there was an increase in socio economic offences in the country. These are the offences which are solely committed for personal gains. These crimes are affecting every part of the country’s economic structure and wrecking the people’s faith in the system. In the following circumstances, the person is very influential and there is every chance to mislead the case. So in such cases bail should not be given. Allowing Bail petition depends upon the nature of the offence and related circumstances.

This post is written by Avinash Medidhi of DU (Faculty of Law). For more info on the subject, please dial 99888-17966.